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Diners told to report illegal restaurant service charges

Government reminds restaurant owners that service charges added to the bill are in violation of the consumer protection law.

ABU DHABI // Diners are being urged to report non-tourist restaurants that try to impose illegal service charges. Fareed al Zubi, the Abu Dhabi Department of Economic Development's chief lawyer, said customers should refuse to pay service charges at non-tourist restaurants. If the establishments refuse to remove the charges from the bill, he said, they should file a complaint.

The practice of adding a service charge of between five and 25 per cent of the bill is widespread in mid and high-end restaurants. Earlier this week, Sultan bin Saeed al Mansouri, the Minister of Economy, said the service charges were "illegitimate commercial practices that lead to exploitation and higher prices for the consumer". He declared them to be "in violation of consumer-protection law". Mr al Zubi said yesterday the ban did not apply to restaurants licensed by the various tourist authorities, which includes most establishments in hotels and private clubs.

Those restaurants can legally levy a 10 per cent service charge, in addition to a tourism tax six per cent of the bill in Abu Dhabi and 10 per cent in Dubai. A fifth of the service charge must go directly to staff. "But the other restaurants have no legal right to charge for service, whether it's 10 per cent or less," Mr al Zubi said. In those establishments, "any customer in a restaurant should not pay this percentage and should refuse to pay it when he gets the bill".

Most restaurants in Abu Dhabi are not tourist restaurants, he said. "The majority are normal restaurants and they cannot charge extra under the name or the excuse of service charges," he said. "The tourist ones have legislation allowing them to do this, but the other ones do not." Violating the consumer protection law that Mr al Mansoori cited could result in a range of penalties, such as fines and closures.

The Ministry of Economy's consumer protection hotline said a ministerial directive would be issued within three weeks. But Mr al Zubi said that was not necessary as the charges were already prohibited by existing laws. "If it's against the law, it doesn't require a decree," he said. "This money is being taken without a legal basis, and as a ministry charged with consumer protection, they are meant to act immediately."

The ministry said it would co-ordinate with emirate-level economic development departments, which are responsible for enforcing consumer protection laws. The Dubai department could not be reached for comment. Mr al Zubi said the capital's development department would act immediately. "There will be inspectors from the ministry and from the local authorities," he said. But enforcing the ban would require consumers to play their part, he said.

"The number of inspectors won't be huge," he said. "Our nature in Arab countries is to shy away and this causes the restaurants to cross the line. You should look at the bill and see if there is a service charge or not. If there is, ask if the restaurant is a tourist restaurant or not." If these restaurants still demand a fee, he said, customers should file a complaint. "Submit a complaint to the department and say that this restaurant took money from me and the department will take the necessary legal procedures," he said.

A manager of an Indian restaurant on Salam Street who requested that he and the restaurant not be mentioned by name said he realised the charges were illegal only after reading media reports. Even so, he said, his restaurant continues to add 10 per cent to its bills. "Out of that, five per cent goes to the waiters while the rest is used to cover for breakages in the restaurant," he said. Customers have already begun protesting against the illegal charges. Staff in fast-food chains said they had been questioned by irate customers, demanding to know the reason why they have to pay service charges. They said, however, that most ended up paying when managers explained why the charge was added.

"We have a 12 per cent service charge," said Mahmoud Yousef, an assistant manager of a popular fast food chain in the Tourist Club area. "A customer came in a day ago and asked us why it was there. I told him the money went for the upkeep of the restaurant and small things like napkins and ketchup, and then he paid. "If a customer refuses to pay it we can't do anything about it. All we can do is report it to the management."

Customers like Maitri Somaia, a 22-year-old Indian copywriter who works in Abu Dhabi, feel cheated. "It's completely unfair that the waiters don't get the money," she said. "They shouldn't make us believe that the charge goes to them. I never leave a tip thinking the service charge was for the waiters. There is no tip-giving culture here." She said she would like to see restaurants follow the rule and would not mind spending extra cash if it went into the waiters' pockets.


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